3D PRINTINGDisruptive technology poised to transform manufacturing

3D printing – a technology that builds products layer by layer rather than milling or forming them from metal or plastic – is beginning to earn its place in everyday use at some of the world’s largest manufacturers. As the technology becomes more powerful and less expensive, the potential to locate small factories everywhere for everything from automobiles to fashion, even for a market of one, becomes a distinct possibility.

Two important milestones in the long march toward a three- dimensional printing revolution were achieved in late 2012 with little or no fanfare. First, General Electric announced that it had purchased a small precision-engineering firm called Morris Technologies, based near Cincinnati, Ohio (USA), and planned to use the company’s 3D printing machines to make parts for jet engines. Then The Economist disclosed that researchers at EADS, the European aerospace group best known for building Airbus aircraft, were using 3D printers to make a titanium landing-gear bracket and planned to “print” the entire wing of an airliner. Both companies cited the fact that it is far more economical to build titanium parts one layer at a time than to carve them out of a solid block of the expensive metal, generating significant waste material.

The twin developments at two of the world’s largest, most sophisticated manufacturers suggest that 3D printing, also called additive manufacturing, is moving into commercial use.

“It’s not just GE and Airbus,” said Abe N. Reichental, president and chief executive officer of 3D Systems, a leading provider of 3D printers that is based in Rock Hill, South Carolina (USA). “Increasingly, we see 3D printing becoming the manufacturing platform of choice in a variety of fields, from specialty automotive parts to personalized medical devices.” The company says half the printers it sells now go into manufacturing settings.

EARNING MANUFACTURERS’ TRUST

Companies such as 3D Systems and Stratasys are driving down the costs of their printers, and more than 100 materials, including engineered plastics, rubbers, waxes, metals and composites, can now be 3D printed. In late February, scientists from Heriot-Watt University in Scotland even announced that they have successfully used 3D printing techniques to layer live stem cells into different configurations, raising the possibility that the technology may one day be used to print human organs.

Consolidation is creating fewer but better providers of 3D printer systems. Such consolidation creates critical mass that gives manufacturers more confidence to rely on the technology in critical paths of product design and production. For example, Stratasys, based in Eden Prairie, Minnesota (USA), merged in late 2012 with Israel-based Objet to create a company that would have had US$277 million in sales in 2011, on a pro forma basis. Sales have been growing by 20% to 30% annually. In many cases, both Stratasys and Objet had been selling to the same customers, including leading automotive and aerospace companies in Europe, the US and Asia. “If we provide them with both technologies from under the same roof, they will get better service, their real needs will be addressed better and their capabilities will grow,” said Amir Veresh, director of strategic alliances for Stratasys.

“THESE TECHNOLOGIES WILL CHANGE YOUR BUSINESS MODEL.”

ENVER YUCESANPROFESSOR AT INSEAD

Independent consultants agree that 3D printing has entered new territory. “I see tangible progress,” said Tom Mayor, senior executive advisor at Booz & Co. and a manufacturing expert based in Cleveland, Ohio, USA. “It’s a lot farther along than it was five years ago when it was an interesting toy in a laboratory.”

MORE FACTORIES FOR MORE FLEXIBILITY

Mayor predicts 3D printing will have a major impact on how CEOs organize their global manufacturing footprints. Whereas a CEO may conclude today that a single factory can serve all of China, 3D printing may allow his or her company to set up 20 smaller factories in China to customize products for the nation’s widely varied linguistic and cultural preferences.

“What the 3D technologies do over the long term is shrink the size of the manufacturing plant, which means it can locate right down the road from the customer,” Mayor said. He urged CEOs to make sure their teams are prepared to spot the tipping point at which it becomes necessary to reconfigure their manufacturing networks.

Taken to its logical extreme, 3D printing could disrupt the entire business model for some manufacturing industries, said Enver Yucesan, a professor of operations management at INSEAD in Fontainebleau, France, who specializes in global manufacturing networks. Yucesan points out that it was relatively easy to digitize books, music and video, plunging the supply chains in these industries into painful revolutions.

“If you look at the way music, books and newspapers are produced or distributed, what we’re able to do today is totally different than the dominant model of 10 or 15 years ago,” Yucesan said. “For me, 3D printing will do exactly that for manufactured products.”

Yucesan urges CEOs to examine industries where digitization has already arrived in search of lessons that can be transferred to their businesses. “These technologies are not going to help you just do the things you’ve been doing for 20 years better and faster,” he counseled. “These technologies will change your business model.”